Apple’s latest iPhone, the 3G S, is currently the talk of the town. But if you’re a prospective O2 customer itching to buy the latest model, or an existing iPhone users hoping to upgrade, then you’d be wise to read the small print.
O2 has already confirmed that the 16GB and 32GB iPhone 3G S models will cost pay-as-you-go …

COMMENTS

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@Joey

"The TomTom app on the iPhone won't be a satnav. It only uses triangulation of phone transmitters which is slower and less accurate and you could be in big trouble in 'the sticks' "

LOL And why would they do that? The iPhone has a built in GPS so for tomtom to not use it and rely on gsm trainagulation so as to create a massively inferior product for no reason whatsoever would be a highly entertaining business decision. Alternatively your arse has misteriously learned to talk to the rest of the world via a keyboard.

O2 are taking the piss...

...cannot be denied. Scandalous, with $1 being worth approx 62p. When the iPhone 3G was initially released, the rates were more favourable (approx 50p to the dollar, don't forget that you have to allow for sales tax in the US). So £60 for a 'new' 8Gb 3G would have been fairer. As for the tethering, the phone isn't a fucking 3G dongle O2. STOP TAKING THE PISS. I understand the fair use idea. I get that you don't want people to abuse the facility, £15 is taking the piss. The data allowance on the contract is good - I've never had a problem with it. How many are stupid enough to think that there aren't caveats to "unlimited" services? I mean really? more than 0.5GB is a lot on a mobile device.

@the 'tard who reckons that the HTC Touch is a bargain for free. They'd have to PAY ME to have one of those, especially on the sorry excuse that is Orange. How much data comes with that contract? That'll be NONE. I was an Orange "customer" (gluton for punishment more like) for 10 years, supposedly a Premier one. I had numerous HTC handset, which were ALL replaced AT LEAST once over 18 month contracts. They. Are. Shit.

Feature wise Nokia and WinMo tick all the boxes, but the features are so badly implemented, it's comical. A Focus RS ticks all the boxes of a high performance sports car - more than and Aston Martin, does that make the RS *better* than the Aston? No.

@ MGJ

"can't see anywhere if it supports bluetooth keyboards properly, stereo headphones, standard 3.5mm jack etc. Need to upgrade from a 2 year old N95 with GPS; does the iPhone have that? All the comments are about tethering; how would they tell?"

iPhone OS 3 has far better support for Bluetooth for applications (they can even have custom protocols), but I don't know if it supports bluetooth keyboards or if it is possible for someone to release an app to add that to the OS.

It will support stereo bluetooth headphones. It has a standard 3.5mm headphone jack. It has AGPS - that's full GPS with additional cell tower assistance which is useful in cities where getting a satellite line of sight is harder. It doesn't come with GPS software built-in, you'll have to buy the TomTom app.

Was going to....

I was going to go straight out and get the new one as soon as it was available, but won't now due to the disgusting pricing policy from O2.

Why do we pay twice that of the Americans, and then have to pay extra for tethering, THEN have to pay to buy out of the existing contract!! No Way O2!!!

They have definately shot themselves in the foot with this one. I had the original IPhone, was expecting a decent upgrade path to the 3G, didn't get it! thought they might reward loyal customers? No way, we end up paying more because of the contracxt buy-out.

F*** EM!! They'll not be getting any cash out of me this time, OR in January, when my contract is up. By then + 6 months, the next nextgen IPhone will be due for release!!! and hopefully by then O2 will have lost their exclusivity and competition will bring the price down.

Buy out

If you buy out your existing O2 contract, what happens to all the inclusive minutes/data which you would be paying for? Do you lose it, or does it get tacked onto the end of the new contract they make you buy?

Anyway, i think the new pricing is ridiculous, but people will line up and flood the stores in the first week anyway... When the previous 2 models came out they were out of stock for weeks and with long queues trailing out of the stores. Perhaps they are planning to handle the initial flood of demand - higher price will reduce demand and increase the margins from those who do sign up... Maybe they will drop the prices significantly after a couple of months?

I already have the iphone 3g, and won't be buying the 3gs at these prices... I might consider it when the current contract expires, if they offer a decent deal on it by then.

The tethering pricing is stupid too, you can use third party tethering apps with the current models if you jailbreak and they work fine...

SatNav feature pointless

If you have £800 to spend on a iphone, you certainly should have a car with either built in GPS or just a straight forward TomTom One which you leave in the car. (glove box etc).

Personally my girlfriend would just think I was a complete tosser if I took an iphone out and mounted on the dash board to use as a GPS. The Tomtom GPS add-on for in car navigation is really not a must have.

Any family car journey I've been on - the last place you want to put your iphone is on a mount on the windscreen, generally the owner is looking up facts to correct any sweeping statements about the current state of the economy / Gordon Brown, or usefully finding a good recommended restaurant via the web, for somewhere to stop and eat. Other than that - surely the kid in the back wouldn't let it be mounted on your dashboard - they would be playing some game on it.

If you getting a cheap phone (nokia 6300 etc) to pair with itouch - there are lots of better contracts than paying £35 a month, I'm sorry to justify the price by combining the two is total rubbish. This thing is overpriced and really not worth it. O2 you need to thing again on your pricing, yeh - and improve your 3G coverage before this thing becomes 'mainstream'

Buy out your contract?

I spoke to O2 this morning and to buy out my contract will cost me the same as keeping it going; just under £35/month for the next seven months in one hit.

Yes, that means if I want to get a phone next Friday, I need to slap down £514 for the 32GB and start a new contract.

It's the exact same cost as buying a new phone/contract and keeping my current contract running and giving the old phone with the new SIM with its seven months of free minutes and SMSes to the missus until January.

As a guaranteed customer, I'm now thinking I'll wait for the v4 next summer as if I sit out my contract, it'll be next year when I can get a new one.

Gutted - Cos I know I'll still buy one

Gutted about the price hike - may be it has something to do with the s**t exchange rate - yet something else to blame this useless government on.

Will probably still buy one when my t-mobile contract is up (2 months) nothing else comes close to the usability of my ipod touch. Year sure other phones tick all the boxes that is apart from the one that's labelled 'is it possible to do all these things this without throwing the dam thing on the floor and smashing it up' - A bit like the fate of a certain N95 I once had!!!!

@Ian Ferguson

This is my current train of though. I bought a 8GB 2G in March '08, and will be eligible for an upgrade in August.

Now, since the 2G cost me £350 from the apple store, it's probably fair to assume I never received a handset subsidy, as I opted not to the take the 3G early upgrade "incentive" of buying out my existing contract.

So, surely as a "valued customer" or whatever they'll refer to me as, surely I am entitled to a larger discount on the 3GS, as they have yet to give me a handset discount at all?

If all else fails, I'll just ask them to unlock my out-of-contract phone, which, IIRC, they are required to do, and piss off to another network. I can live without visual voicemail.

Missed a trick

18 month contract - as is, no early upgrade but less minutes /more line rental than 2 year option

24 month contract - but that anyone who has this can upgrade to a new iphone after 12 months at whatever the cost for a new customer is, at this point the old two year contract is removed, and you get a new two year one. This way anyone who wanted to could update annually to a new phone without disadvantage, but if they wanted to leave then they would have to wait the full 2 years (one of which would be staring at an iphone which was newer than the one they possessed), but they get full advantage of cheap calls loads of miniutes free phones etc

Shocking...

The title says it all.. I won't be upgrading! The main thing I want is tethering so I can use my iPhone 3G with my TomTom via Bluetooth - a BASIC feature that you would expect to work - I am not paying on top of my contract for this!

warranty

Talking to O2 today, it would seem that the warranty on the iPhone is only for 12 months, even though the contracts are 18-24 months. Apparently one may take out an extended warranty for around £10 per month (but only when initially taking out the contract).

So if you don't take the extended warranty option (at around £240 extra for say 2 years), then you could end up with an broken phone after 12 months, that you would still have to pay another 6-12 months of rental for!

I won;t be upgrading

I still want to know ...

... how will they know whether your data use is stand-alone or tethered? Will the new OS monitor data pass through and lock it down if there's an ACK/NAK fail from the carrier network over whether you've paid your bill?

This would explain how comes AT&T are taking the same stance in the US over using the iPhone 3G/3GS as a modem. Bend over and spread 'em ...

I was willing to put with no tethering knowing it would be coming in an OS release, but these charges for tethered data are now making me reconsider my iPhone and think about the Palm Pre or a Nokia.

iPhone coming to Vodafone?

Just spoke to someone at Vodafone who told me to "hold off for a month or so" when I said I wanted to leave for O2 and the iPhone as they believed that "the new iPhone is not exclusive to O2".

Could be bullshit, or could be the reason why O2 aren't able to offer the same discounts as AT&T in the states: their exclusive agreement with Apple has expired, along with any discounts from Apple that might have come along with that agreement.

But it's a iPhone!!!!

The 3GS iPhone looks nice, has flashy adverts with a very populated app store ("Need to divide a restaurant bill by 2, there's an App for that").

I fail to understand the hype for a new device that offers what Windows mobile has had available for over 3 years. It’s as if the main stream media can’t be bothered to read the manual……

HTC/WinMo handsets have had tethering, MMS, sync with Outlook, emails, web browsing, YouTube, and multi codecs for audio & video, but get so minimal mainstream press coverage by comparison. (New iPhone on all National papers' websites front pages) My TyTn II is still running strong, and still gets mistaken for an iPhone (until the keyboard slides out).

Apple launch a v3 OS, and don’t/can’t make features like MMS, video & tethering backwards compatible. And still no multi-tasking - come on - no wonder the device is fast, it’s not having to do any work!

On the carrier front, T-Mobile Web’n’walk offers virtually unlimited browsing, and their £1 a day limit option for non WnW use is excellent for regular tethering away from home (One month I used £150 "worth" of data - Actual charge £27.50)

Why Not Pay As You Go?

Hmm - what part of 18 month "contract" don't people understand?

Surprised no one has mentioned the £440ish upfront Pay As You Go deal, which compared with an 18 month light user contract starts to make sense. You get a bunch of free texts when you top up £10 a month, that £10 takes care of light calling requirements, and you still get the all you can eat data for the first 12 months. After that, it's £10 a month.

New iPhone out after 12 months that you simply must have - just sell this one. In good nick I'd be amazed if it's worth less than £100-£150.

I reckon the logic of this is that the typical prepay punter is incapable of controlling their phone use - and so O2 are counting on excessive use driving their profits. In my case, they'll be wrong.

Incidentally, can anyone point at evidence of a 500mb monthly data limit? Sure, these are common on lesser "smart" phones, but I thought Apple fairly adamant that it must be properly unmetered. Just light use of iPlayer and the odd Podcast download would easily blow that limit out of the water.

Tethering? No Thanks!

Taking it as a given that O2 were always going to shaft its iPhone customer for tethering (the alternative being to shaft its own business model - as if) I'd like to make a couple of observations. I have an iPhone. The signal quality is renowned. Its not the best. Working away from home, my regular hotel is not, according to my iPhone, within range of a 3G tower. However my O2 USB 3G modem is. And its six inches from my iPhone. So here are my two thoughts:

One. I wouldn't use tethering unless it was free because most of the time I know full well I'm not going to get 3G data speeds. The phone just isn't capable. End of story. The most you can do is email and web browsing. No downloads, no streaming, no VPN (unless you like your VPN sssslllllooooooooowwwww).

Two. It is only slightly more expensive to sign up to O2's mobile broadband with a separate 3G USB modem - and the modem is much better at finding and using a 3G signal. Oh, and you get free access to The Cloud with those too. And I can make calls while I VPN, stream and download.

As far as the mobile broadband market goes O2 are no worse than any of the others... and if you don't take up tethering you might actually be able to beat O2 into a deal, or walk and go to Vodafone, Orange, T-Mobile... you do have a choice.

I'm off now to download Safari 4 for my Mac. Using my 3G modem. While I phone home. Looking forward to Snow Leopard and iPhone 3.0

How will they know whether you are tethering?

It's probably simpler than you think; my bet is that the tethering will be hardcoded by the operators to use a different access point. In that case, it's very very easy for them to now if you're tethering.

- A 200 SMS package is $5/month (though you could go without inclusive at $0.20/SMS).

- They're only available on 24 month contracts.

When you amortise the cost of buying the handset over the contract, you end up at ~$92/month for the 16Gb and ~$96/month for the 32Gb. That's about £56 and £59/month respectively.

It's probably even more than that as none of my calculations include tax (unless the prices on the AT&T site already do), coz I don't know how all that works in the US.

For the sake of comparison, 600 minutes and 500 SMS can be had for £37.89/month (16Gb) or £41.56/month (32Gb) in the UK on 24 month contracts. On 18 month contracts, you're looking at £44.54/month (16Gb) or £49.50/month (32Gb). All on the £34.26/month tariff.

Can i remind EVERYBODY!!!!

That Apple are the ones who dictate the terms of the contract for the service providers, and those terms include the cost of the handset to be a set amount and to receive a proportion of the line rental costs (the ONLY hardware manufacturers to do this).

So while O2 seem to be "ripping off" britain, they are the only ones to have agreed to the terms. Without that, the iPhone would not be available from any service provider and would be a grey import with no support.

Unlimited data on the iPhone is NOT the same as unlimited 3G data on a Laptop, as anyone who uses their lappy for watching downloaded movies can tell. the cost of the data is the same as having a 3G dongle. I dont see the point in not offering a discount, but i bet you could ask for a discount if you were out of contract.

I agree with the sentiments regarding lobotomies and such, but let's not go off half cocked, eh!

And, YES i do work for O2, but would never buy an iPhone, so am not just spouting the party line about our products (except for Broadband, which is fantastic (yes, that is aimed at all you orange fanbois, all 3 of you)).

Fan Boi

Okay, I'm something of an iPhone Fan boy - although I can still acknowledge some its missing features (now only LED flash)

I still love the iPhone, look forward to OS3.0 but think O2 have royally f***ed up. The new pricing is bad enough (although why current 3G users expect to be able to cancel/break their current contract without penalty is beyond me).

The real killer is the insane tethering costs. £15 a month? I thought I already had an 'unlimited data' plan with the iPhone. I can understand O2 not wanting users to hammer their (crap) 3G network for 10's of gigabytes per month, but why not a soft cap of 1-2gb per month. I imagine for most users, the occasional ability to use tethering would be useful - but most don;t use it enough for £15 per month.

RE: SuperTim

"That Apple are the ones who dictate the terms of the contract for the service providers, and those terms include the cost of the handset to be a set amount and to receive a proportion of the line rental costs (the ONLY hardware manufacturers to do this)."

This is not true - O2 have themselves admitted they have reduced the subsidy on the 3GS compared to the 3G for new customers, and this is the reason for the 87% price rise.

Looks like your management are lying to you.

"Unlimited data on the iPhone is NOT the same as unlimited 3G data on a Laptop, as anyone who uses their lappy for watching downloaded movies can tell. the cost of the data is the same as having a 3G dongle."

Well it is - there's already a fair use policy on the unlimited data and using p2p or streaming is already prohibited. Publish the limit and enforce it . But there is no reason for the obscene charge.

@SuperTim

So "Super"Tim. Why are the contracts different from country to country and telco to telco then? If Apple *do* dictate terms, why have AT&T dropped the bat by stalling on MMS (as service they presumably already offer) and tethering (to the noticeable chagrin of the crowd, Forstall and Schiller)? I smell a company trying to "distance" themselves from a fuck up...

My prediction

After initial pathetic sales results and when Apple realises that O2 have screwed up so bad with their pricing that a Razr is outselling the new toy in town, they will pick up their brand new 3GS and will give Vodafone a quick call to let the doors wide open for them just like they have in other countries. Vodafone will subsidize aggressively and O2 will have to retaliate so the final result will turn into a fair deal in place coming from one form or another. Btw, is not wishful thinking but just a fact of life.

@Adam Jarvis

That may be your opinion, but I fear it is not universally held. I guarantee that £800 for an iPhone is far, far, far cheaper than you can buy a car with built in satnav for.

I also postulate that one would need a phone (say free but £25 per month = £600 over 2 years), GPS (tomtom or otherwise - call it £100 and that is very generous) and an mp3 player (you will get laughed at in the playground if it is anything other than an iPod but hell call it £50) which already runs to something like £750 over 2 years, as opposed to £997 ish for the iPhone over the same time.

So what you are really saying is "Anyone who has £247 over 2 years (or £10 per month) to spend on an iPhone should instead buy a bigger car".

Also, we don't all want to have to carry 3 devices (some of us use GPS for walking as well as driving - very difficult to carry your car up a mountain) when one will do, many of us either don't have children or bring them up to not be selfish shiny-grabbing brats (or you could buy them a DS) and would buy our wife/girlfriend/wife and girlfriend their own iPhone if they wanted one.

@Mac Phreak

Surprised you've had bad experiences with HTC devices. My current HTC PDA has proven utterly indestructible many times over. And my old HTC PDA, whilst buggy on the software side, was totally immune to damage. And by "damage," I don't mean "thrown onto the bed a lot" - I mean more along the lines of "dropped on concrete a lot."

@Greg J Preece

Had big issues with built quality and the OS. The handset vibrated itself off my desk and cracked the screen on one occasion. Freak occurrence maybe, except it landed face down on carpet! Wasn't happy! The keyboard on my Tytn kept coming away, as a result I hate slide-out keyboards. The screen on the Touch was awful - felt cheap and it would scratch on my stubble (OK, might be exaggerating, but it *seemed* like it!). To be fair I don't know what they are like now, but after a cursory look over the G1, it looked and IMHO felt "cheap" after having the iPhone for a while. On the OS side, I didn't like the fact that the OS reset and lost *everything* if the battery went flat. Not good! Down right useless infact! Do they *still* do that? It was fiddly and inconsistent too - I don't think it was helped by operators "enhancing" it's feature set. What with iPhone 3.0, Palm's Web OS and Android, I think MSFT are out of that particular race - WinMo 7 IMHO is only ever going to be playing catch up without Gates in charge - see Vista, Zune and ZuneHD.

@I fail to understand the hype for a new device ...

Huh? Have you actually used an iphone and compared it with a Windows Mobile ... not on paper by what hardware or software is available BUT actually use it? Sorry, but to me there is no comparison ... sure hardware wise there are better LG / Samsung / Nokia's out there BUT Windows Mobile sucks and I for one would be glad to stop using it.

I've held off but am planning on getting a 16GB 3GS on Friday and on PAYG ... I don't use a smartphone for any real phone calls or texts so having "unlimited" wifi and 3G for 12 months (costing £120) is actually very reasonable compared to Vodafone / T-Mobile / Three etc and means that I get a 16Gig ipod + camera + GPS + unbiquitous computing platform for £320 and its mine for keeps. ... and I'll drop £10 on a SuperSIM from Amazon and see if my Three modem SIM will work when the pitiful O2 HSDPA is out of range 8-)

Looking at the contracts though you get scary costs and not a lot extra to show for it.

@Jared Earle

iHateOverPricedProducts

I would love to own some apple devices, they are pretty solid from what I am told and seen of them, however you are f**kin taking the piss if you think I will ever give this company any of my money because basically APPLE = RIP OFF THIEVE MERCHANTS and ROBBERS! I don't mind paying for quality but come on, be f**king real for a second who has a grand lieing around to spend on a mac book never mind a phone when you can get the same functionality in either device for less than a third of the price that APPLE want.

O2 pricing on IPhone

I used to like Apple...

I've been using their products since my old Apple IIsi ... but now their popularity has gone to their heads and they've started to take the piss. They deserve to go down in the minds of the people with M$ for this.

free upgrade?

Why should iPhone users get free early upgrades?

Does a Nokia customer get a free early upgrade to the latest and greatest nokia offer? No, they have to wait to upgrade like EVERYONE else. just because your iPhone has an apple logo, it doesn't mean you should be allowed a new one free every time they release one.

And yes, things are expensive in the country, always, not just iPhones.

You were allowed to upgrade to the 3G iphone when it was released, because the original iPhones were not subsidised in price. The new ones are subsidised.

iPhone 3G S coming to Orange!

You may be interested to know that the iPhone is going to be sold on contract by Orange. It should be on sale around August to October this year. (It has been confirmed by someone who works for Orange.) This is not a joke.

O2 are crazy....and gonna lose a lot of customers

I don't see why people are upset about not getting a free/cheap upgrade from the 3G. You signed a contract and got the 3G subsidised.

But the tethering tarrifs, no unlimited txt bundles, rapidly going downhill CS, no improvement in tarrif contents and worst of all - all this is exclusive to the iPhone. Most other phone tarrifs on O2 offer much more for less. O2 are scamming their iPhone customers.